Packaging giant Smurfit Kappa is going to invest an extra €1.6bn in its business between now and 2021 as it seeks to drive superior returns from the group, according to CEO Tony Smurfit.

It's the largest four-year investment plan ever initiated by the FTSE-100 company, and will include new machinery, product innovation, depots and production plants.

But Mr Smurfit insisted the company - with revenues of €8.5bn last year and 64,000 customers include Pepsico, Aldi, Kellogg's and Unilever - won't shy away from acquisitions, as long as they can deliver value and returns for shareholders.

"We're backing ourselves," said Mr Smurfit of the investment plan, adding that the group is "not there yet" in terms of generating superior returns.

The packaging boss also revealed that Smurfit Kappa had walked away from €2bn in potential mergers and acquisitions (M&A) in the past "two-plus years".

"We're not giving up M&A," said Mr Smurfit. "We have very significant capacity to do M&A ... as long as it remains, long-term, a good deal for the company."

"We're disciplined. We have done some and we continue to look at stuff, but we're only going to do it if it makes sense, if the quality of the asset is good and we can get a return over the long term," he added.

Speaking to the Irish Independent, Smurfit Kappa chief financial officer Ken Bowles said that opportunity for acquisitions remains and that the group has the firepower to undertake them.

The company completed two bolt-on acquisitions last year, buying facilities in Russia and Greece.

"There is still is some consolidation to be done in Europe," he said. "It's about finding the right ones. We actively look at anything that comes across us, and indeed go seeking some that aren't there," he said.

Smurfit Kappa had net debt of €2.8bn at the end of 2017, representing a net debt to ebitda (earnings before interest, tax, depreciation and amortisation) of 2.3 times.

Yesterday, the group said it plans to maintain its debt metric within a range of 1.7 times to 2.5 times, compared to a previous target of two to three times. Mr Bowles said the company has capacity to do big deals if required.

"There isn't necessarily a deal that isn't doable," he said.

"For the bigger deals, the transformational ones, you're talking about a mixture of debt and equity generally. Given where the balance sheet is, there really isn't a deal that you would say is out of our grasp."

Mr Smurfit said the group would remain "agile" to avail of market opportunities.

Smurfit Kappa has earmarked €600m of its new investment programme for 2018, on projects that will be completed between this year and up to 2020.

The company will be funding the increased spending between now and 2021 from its own resources. It generated free cash flow of €307m last year.

Releasing results yesterday, Smurfit Kappa said its fourth quarter ebitda rose 10pc to €351m, with the figure in Europe rising 18pc to €269m.

For the full year, its revenue rose 5pc to €8.52bn, while ebitda was flat at €1.24bn.

Its European businesses performed strongly, but Mr Smurfit said its operations in the Americas did not fare as well, especially in countries such as Argentina and Colombia.